Britain’s economy heading for ‘worst of ALL worlds’ in 2025, Keir Starmer is warned – as GDP flatlines with no growth

BRITAIN’S economy is “headed for the worst of all worlds” next year, Keir Starmer has been warned - as GDP flatlines with no growth.

The latest blow for Sir Keir Starmer comes in a survey by the Confederation of British Industry.

And the hike to company National Insurance Contributions is given as one of the main reasons for the gloom among business chiefs.

The survey found expectations for growth have hit their lowest since the aftermath of former PM Liz Truss’s disastrous 2022 mini Budget.

Services sector business is expected to decline, while manufacturing output is also anticipated to fall sharply between January and March.

It comes as new figures show the economy stagnated more than first thought in the third quarter of this year amid fears over low growth.

The Office for National Statistics (ONS) said GDP showed no growth between July and September, revised down from an estimated 0.1% rise previously.

It means the UK economy has either shown no growth or shrunk since July this year in a blow for the government.

The latest monthly GDP (Gross Domestic Product) data revealed the UK economy unexpectedly shrunk in October by 0.1%.

The ONS said there was no growth in the services sector between July and September while a 0.7% increase in the construction sector was offset by a 0.4% fall in production.

Meanwhile, it said early estimates suggested real households' disposable income per head show no growth in the third quarter.

This follows growth of 1.4% between April and June.

Alpesh Paleja, of the CBI, said: “There is little festive cheer in our latest surveys, which suggest the economy is headed for the worst of all worlds.

"Firms expect to reduce both output and hiring, and price growth expectations are getting firmer.

“Businesses continue to cite the impact of measures announced in the Budget, particularly the rise in employer NICs, exacerbating an already tepid demand environment.”

It comes after the Office for National Statistics recently revealed GDP fell by 0.1 per cent in October.

Yesterday, Commons Leader Lucy Powell said Britain was “going down the Swanee” when Labour seized power in July. But she insisted: “We are starting to turn that oil tanker around.”

Responding to the CBI survey, Shadow Business Secretary Andrew Griffith said: “Rachel Reeves’s tax-raising spree and trash-talking her economic inheritance are killing businesses and jobs.

“If there is a recession — and that seems increasingly likely — it will be one made in Downing Street.”